Entrepreneurial Lessons From Instagram Co-Founder Kevin Systrom

Some might call them lucky. They launched a photo app, got 100,000 users in their first week, and sold it for $1 billion less than two years later.

Instagram co-founders, Kevin Systrom and Mike Krieger, will be the first to tell you they encountered some luck, as any business does. But Instagram’s success isn’t 100% attributable to luck.

Instagram solved real problems. Systrom says that entrepreneurs “should not be afraid to have simple solutions to simple problems.” At Instagram, they focused on solving three problems. Their solutions were:

Making photos beautiful

Sharing on multiple social networks

Uploading photos quickly

Krieger and Systrom have shared some of what they learned along the way and what they recommend for other entrepreneurs. Let’s get into it.

Don’t be Afraid to Pivot

Systrom and Krieger originally started a check-in app called Burbn.

It didn’t get much traction and most visitors were using it only to take photos. Systrom himself admitted that when he used the app, he was more interested in looking at the photos people took and less interested in seeing where they checked in.

After seeing user behavior and low user adoption, they pivoted to the photos app that we know today as Instagram. On its first day, it got 25,000 uploads. Systrom knew they were on to something.

Without listening to users, they probably never would have pivoted. Systrom explains what he learned:

“[Follow] what people love. If you just play user psychologist a little and you listen to your users and you see what they’re focusing on and what they’re ignoring…sometimes if you do what they’re hinting…you should do because of their behavior, good things can happen.”

He adds:

“The lesson I’ve learned is that you need to make sure to always cut what doesn’t work, cut the stuff that isn’t popular, and focus on continually improving your product and your focus….

“Companies go through identity crises and they figure themselves out over time, but I think it’s all about keeping what sticks and throwing away what doesn’t.”

Systrom explains that it’s important to not only listen to what users say, but watch their behavior:

“Behavior speaks much louder than words.”

And:

“It’s all about feedback based on behavior.”

He recalls one instance where they removed the live filter and users voiced their outrage. He says that when you looked at the data, you noticed that no one was using the live filters. Throw away what doesn’t work or isn’t being used. Watch the data:

“Over time what you do is you simply take in data about what your users are doing and you focus on the stuff that people love the most. The second we focused on the photos with the filters, it became a phenomenon.”

You Don’t Need a Big Team in Order to do Great Things

In an interview after the Facebook acquisition, Systrom says that keeping the team small was his biggest mistake but also his greatest strength.

“Not hiring people quickly enough, but it was also one of our strengths. I don’t know what we would’ve been had we hired people more quickly. But just looking back what I know now I just would have hired people way more quickly and I think it’s a confidence that those people are going to have the same care and detail orientedness for your product that you had. Looking back I think we could have coached that….

“I wish we would have hired more quickly, but it’s hard to say that given all the success we’ve had. At the same time, who knows, maybe we could have been three times as big.”

He adds:

“The success of Instagram in the future relies solely on having the best people working on it and having the systems and groups of people in place that make sure this thing lives on forever.”

In October 2011 he emphasized the importance of keeping the team small:

“When you’re building a team, I don’t think it should be about filling head count. You shouldn’t say ‘I’m going to go out there and try to be a 50 person company or something.’ What we’ve done so far I think has worked very well, which is we find the best people in the world. The best designers, the best engineers, and that’s who we bring on….

“For us it’s really about picking the exact positions on the field that we want to fill and finding the best people to fill those.”

He says that:

“Great products and companies come from great teams.”

Systrom believes it’s better to have a small team composed of great people than a big team composed of mediocre people. Instagram hired slowly because Systrom believes that one great engineer can do the work of five mediocre engineers.

And on the topic of hiring…

Hire Smart and Passionate People

“I look for passion. I think smart people are passionate people. When you ask them what they’re really good at and what they’re really passionate about, usually they can explain it in a way that makes you get inspired about something. Whether that’s about cocktail making or cooking or coding. Smart people have passions in life and that’s really what I look for….

“We’re not into brain teasers or anything like that. We just want to work through problems with people. That’s really what matters at the end of the day is if you can sit down with someone and work through a tough technical problem together.”

Systrom says that it’s important to find smart people with a lot of potential and put trust in them.

You’re Not Just Starting a Product, You’re Starting an Organization

Systrom tells entrepreneurs to remember that there’s more to it than just starting a product. It’s starting an organization.

“I think when people decide on whether or not they’re going to go into entrepreneurship, you need to remember that building a product is great, but there is a lot of legwork involved in getting a team off the ground, I think specifically in recruiting a team. Team building is one of the most important things when you get off the ground. It’s not just about having a great idea. It’s finding the people to bring in to make that idea happen and supporting them by shielding them from the press and the checking accounts that you have to set up, etc. Especially raising capital….at the same time, it’s supremely important to know that you have to be good at building a product and that you’re going to be willing to do the legwork to do the rest.”

This is why many go to business school: to get a good background in accounting, ethics, some law, marketing, etc. If you don’t know any of these, and know only product, you’ll be in for a very steep learning curve.

Be Able to Explain What You Do in 30 Seconds or Less

Businesses (especially apps) should be able to explain their product in 30 seconds and have users understand it. As quoted by Fast Company, Systrom says:

“Products can introduce more complexity over time, but as far as launching and introducing a new product in to the market, it’s a marketing problem. You have to explain everything you do, and people have to understand it, within seconds.”

This is the equivalent of an elevator pitch. Give someone your value proposition and what makes you unique in 30 seconds. Explain why they need your product in 30 seconds. If you go beyond that, you’ve lost people’s attention.

Systrom says it’s important to cut the fat out of a product. He says to stay focused on your core product:

“Don’t do too much, and cut away everything that doesn’t matter to the success of your product. Doing too much can create drag and hinder your ability to get things done.”

You’ll Start Losing When You Think You’ve Won

Some people will love you, some will loathe you. Systrom advises that you shouldn’t let yourself be swayed by either side. That’s especially likely to happen if everyone loves you. You’ll think you’ve won. That can be dangerous.

“The second anyone starts thinking ‘Oh, we’ve won,’ you just start acting differently; and I just think that’s one of the things in Silicon Valley that companies need to work actively against.”

Avoid Private Beta

“Stay away from this private beta stuff. Put it out there, find the people that are vocal about what you’re doing and put it in their hands and listen to them, listen to what they’re excited about.”

Systrom says that

“the problem with stealth startups is that you don’t get the feedback you need quickly enough. In order to test whether you’re working on the right thing or not, you need to put it in front of people….for us, getting it in front of users was the most eye opening experience. I remember putting Burbn in front of people we didn’t know and they were just like ‘What is this thing, what are you doing?’ We would be in a busy bar and try to explain to them on our mobile phones and they just wouldn’t get it and that happened enough in front of people outside of our friend group that it was really clear we had to work on something different or at least refine the idea. And I think that’s something to keep in mind as you’re going about starting a startup. Building the minimum viable product is super useful. Don’t build past what you need to build to answer the questions….

“So ask yourself, how much work do you need to do to actually prove whether or not this thing’s going to sink or swim?”

If you’re going to fail, you want to fail fast. Don’t hesitate to get feedback from people. Systrom says that 8 months is too long, but earlier than that may be too long, as well. Get it in front of people and hear what they say. According to Systrom,

“you need to fail in order to find the right solution” and “you should assume from the start that your first idea is not going to be your last; your job is to fail your way to success.”

Let Yourself be a Little Crazy

The only person holding you back is yourself:

“Fear…is the one thing that keeps people from doing the biggest things in the world….when people have passions I think they hold themselves back from them because of a fear. I think people just feel like ‘Oh, well, they’re just not that talented’…I actually truly believe any person here could create the next Instagram….I think it’s really people that hold themselves back, and I think the way around that is by letting yourself be a little crazy.”

What kills most startups:

“The lack of a dark moment. Because you keep going and you keep going and you go sideways. And you’re not going up, you’re not going down, you’re just going sideways. You get a trickle of users in; you’re working on something that excites people, but not that much. And the hardest part of going from Burbn to Instagram was actually realizing that we had to do something new. And making that decision was one of the hardest parts of my entrepreneurial career.”

On mobile:

“You either need a lot of users in mobile or you need to be a monetization platform in mobile.”

On great businesses, products, and teams:

“A great business is one that creates a place where people love to come all the time, spend time, and spend money. Whether that’s advertisers spending money or customers spending money.”

“Team building is one of the most important things when you get off the ground.”

“Part of entrepreneurship is realizing different things along the way are going to excite you in different ways. The people that grow best with companies are the people that realize that and get really amped about the different challenges, the different stages of the company.”

“It turns out when you make really nice stuff that people love, they will spread it to their friends because they’ll rave about it, they’ll tell people about it. That’s what I think at the end of the day has allowed us to grow quickly is the people get really excited about sharing photos and they really get excited about applying filters to them and it’s cool to show your friend you do this thing. That has caused us, above all else, to spread very quickly.”

On solving problems:

“Far too many startups are technologies in search of a problem.”

On getting feedback:

“I think it’s important to hear feedback, sometimes you just don’t need to listen to it. I think it’s important to seek it out, but I don’t think it should be the end all be all. I have had terrible people give me terrible advice in my life….at the end of the day you just have to follow what you love and what gets you amped and up in the morning because as long as you make enough to put a roof over your head and maybe some food on the table every now and then, like what do you care if people are right? At least you’re enjoying yourself.”

Instagram is a success because they were deliberate, thoughtful, and careful in everything they did. Anyone can add filters to photos, but that’s only one aspect of the product. Systrom says that Instagram isn’t a photo app, but a communication app. Filters are one part of the reason for their success.

Many other entrepreneurs, upon finding success, would have run the company differently. Jason Calacanis says that, once he saw Instagram was a success, he would have raised $50 million, hired 50+ people, and immediately released an Android app. Others may have put advertisements in the app or on the web to get revenue. Instagram didn’t do those things, yet still has had a successful advertisement. They know what they do well and don’t get far away from it. There’s something that can be learned from that.

Optimize Every Web Interaction

“We would be in a busy bar and try to explain to them on our mobile phones and they just wouldn’t get it and that happened enough in front of people outside of our friend group that it was really clear we had to work on something different or at least refine the idea.”

Forget being able to explain your product in 30 seconds, I think the “explain it in a busy bar test” may be the new standard! If tipsy people can understand the concept, you’re golden.

It might be a very good test. A loud bar, things going on and people need understand what your product does.

For some products you’ll just show people how it works and they’ll get it, others you’ll have to explain how it works and demo the product in front of them. If people consistently don’t get it, you might need to refine your product.

This question was brought up a lot in pre-acquisition interviews. He brought up the idea of premium filters ($.99 each).

And I thought that I heard that from the beginning they planned to launch with filters you pay for, but they couldn’t get it figured out in dealing with in-app purchases. Don’t quote me on that though.

Systrom shot down the idea of a paid app.

I think they first wanted to build a user base and then experiment with ways to make money. Systrom said a few times that “he has a couple ideas in his head”.

If they became really desperate, they could put small advertisements on each webpage that contains a photo, or maybe one every 5 photos. It would take away from the user experience so that would probably be a last-resort option.

Perhaps Systrom and Krieger were always looking for an acquisition. He knew Zuckerberg early on (well before Facebook’s IPO) and knew the Twitter founders pretty well.

It’s difficult to know how things would have worked if Instagram didn’t become such a success. My guess is they would have pivoted to something different.

Thats exactly what I’ve noticed – sometimes the remedies are worse than the disease ;) I dont want to learn some tool interface for two days to be able to solve a simple problem I can solve manually in 2 hours

Wait, why is immaterial? Seeing what they are doing/did is important and there are lessons to be learned. Granted, not everything Systrom says will work for every company, because each company is unique. But there are some things to takeaway and learn from. Perhaps the most important thing and universal is that products should be simple and you shouldn’t be afraid to have simple solutions to simple problems.

Awesome post. I am personally not a huge fan of social media. I understand it but I just can’t do it. I am amazed at what these guys accomplished and it was just so simple. So now I’m motivated to go put on my thinking cap. What can I solve…?? hmm..

Thanks for sharing thee valuable lessons. I have heard the story of Instagram before but now I have the chance to read what Kevin said. Awesome! These are very priceless lessons every entrepreneur should know.